The $45-million hotel at Selma Avenue and Cahuenga Boulevard, shown in… (Killefer Flammang Architects )
Long-standing plans to build a $45-million hotel in Hollywood have been revived, the developers said, with new financing and a new operator.
The nine-story hotel at Selma Avenue and Cahuenga Boulevard, formerly to be known as the Selma, was approved by city officials in 2008, but funding for real estate development grew hard to come by as lenders tightened their purse strings in the economic downturn.
"We fought hard to find conventional financing," developer Richard Heyman said. "But conventional doesn't exist anymore, so we turned to finding alternative sources of capital."
The solution, he said, was the federal EB-5 program, which provides green cards to immigrant investors who put up a minimum investment of $500,000 for development in targeted areas. The project, expected to create more than 900 jobs, received federal approval last month to participate in EB-5 financing.
Construction on the 148-room hotel will begin in the spring, and it will open in fall 2013, according to Heyman and his partner Grant King. It will be operated by Hampshire Hotels & Resorts under the New York company's hip Dream Hotel brand.
The design by Los Angeles firm Killefer Flammang Architects includes a rooftop swimming pool, restaurant and lounge to be built atop an existing parking garage.
Heyman's company, Five Chairs, developed Milk Studios in Hollywood and transformed the former Frederick's of Hollywood building on Hollywood Boulevard into the Kress nightclub.
Other Dream hotels are in New York, Miami Beach, Bangkok and Cochin, India. They are intended to be full-service but relaxed luxury hotels, Heyman said.
• Pasadena retail and office complex is sold for $21 million
One of Pasadena's most recognizable commercial properties, a retail and office complex in the South Lake Avenue commercial district known as the Commons, has been sold for $21 million.
The 87,000-square-foot property is anchored by the Williams-Sonoma building, which was completed in 1912. It is also home to restaurants including Green Street Cafe, the Counter, Lemonade and Cafe 140. Other retail tenants include the Pasadena Cheese Store, Carmody & Co. and the Wine Detective
The Commons covers two acres and includes buildings at 140 to 142 S. Lake Avenue and a garage at 155 S. Mentor Ave.
Arenda Capital Management, a Los Angeles private real estate investment firm, and AEW, a Boston pension fund advisor, bought the Commons from SRO Properties of Los Angeles, brokers said.
The off-market deal required Arenda to assume an existing loan funded by commercial mortgage-backed securities, said Carlos J. Lopez, president of Hanley Investment Urban Retail Advisors, who represented the buyers.
•Apartment vacancy rate forecast to be 5.5% in 2012
The nation's apartment vacancy rate is expected be 5.5% at the end of the year and hold at that rate through 2012, a real estate brokerage said.
"Apartment demand is benefiting from slight job growth as well as an expanding pool of potential renters," said Gleb Nechayev, a senior economist for CBRE Group Inc.
Vacancy is down slightly from a year ago and off nearly 2 percentage points from the 2009 peak, the brokerage report said.
Conditions are generally good for landlords but vary from market to market with rents flat or down slightly in some and rising by almost 15% from a year ago in others, Nechayev said.
Over the next two years, metropolitan areas such as San Francisco, San Jose, Denver, Seattle and Austin, Texas, are expected to see the highest rent growth.